The output price indices measure change in the prices of goods produced by UK manufacturers (these are often called 'factory gate prices').

The input price indices measure change in the prices of materials and fuels bought by UK manufacturers for processing. These are not limited to just those materials used in the final product, but also include what is required by the company in its normal day to day running.

Imported Price Indices (IPIs) are a series of economic indicators that measure change in the prices of goods and raw materials imported into the UK. IPIs are a key component of input price indices.

Exported Price Indices (EPIs) are a series of economic indicators that measure change in the prices of goods manufactured in the UK but destined for export markets.

Output prices: summary

In the year to September 2012, movements in output prices for UK manufactured products were as follows:

The output price index for home sales of manufactured products rose 2.5 per cent, compared with a rise of 2.3 per cent last month.

The output price index excluding food, beverages, tobacco & petroleum rose 1.2 per cent, unchanged from the previous two months. The last time the annual rate was lower was in December 2005, when the index rose 1.1 per cent.

The output price index excluding excise duty rose 2.2 per cent, compared with a rise of 1.9 per cent last month.

Between August and September:

The output price index for home sales of manufactured products rose 0.5 per cent, compared with a rise of 0.5 per cent last month. The main upward contributions to the price index were petroleum products, food products and chemical & pharmaceutical products.

Download table

Output prices

Download chart

Input prices: summary

In the year to September 2012, movements in input prices, that is the price of materials and fuels purchased by UK manufacturing industry were as follows:

The total input price index fell 1.2 per cent, compared with a rise of 1.1 per cent last month.

The input price index for the manufacturing industry excluding the food, beverages, tobacco & petroleum industries fell 1.3 per cent, compared with a fall of 0.6 per cent last month.

The price of imported materials as a whole (including crude oil) fell 3.5 per cent, compared with a fall of 1.4 per cent last month.

Between August and September:

The total input price index fell 0.2 per cent, compared with a rise of 1.9 per cent between July and August. The main downward contributions to the fall in the price index were other imported parts & equipment, home produced food and other imported products. These falls were offset by a rise in the price index for fuels (incl CCL).

In seasonally adjusted terms, the input price index for the manufacturing industry excluding the food, beverages, tobacco & petroleum industries showed no movement between August and September.

The price of imported materials as a whole (including crude oil) showed no movement between August and September, compared with a rise of 2.0 per cent between July and August.

Contribution to 1 month percentage change in total (-0.2%)

Download chart

Output prices: summary of statistics

The overall output price index rose 2.5 per cent in the year to September 2012, compared with a rise of 2.3 per cent in the year to August 2012. The output price index rose 0.5 per cent between August and September, compared with a rise of 0.5 per cent between July and August. The main contributions to the rise in the price index between August and September were from petroleum products, food products and chemical & pharmaceutical products.

Petroleum product prices rose 2.0 per cent between August and September and rose 3.4 per cent in the year to September. This is the highest annual rate since April 2012, when the index also rose 3.4 per cent. The last time the annual rate was higher was in March 2012, when the index rose 4.7 per cent. The monthly rise was mainly due to a 2.8 per cent increase in the price of unleaded petrol and a 1.1 per cent increase in the price of diesel & gas oil.

Food products prices rose 0.5 per cent between August and September and rose 2.3 per cent in the year to September. The monthly rise of 0.5 per cent is the highest monthly increase since May 2012, when the index also rose by 0.5 per cent. The last time the monthly increase was larger was in July 2011, when the index rose 0.6 per cent. The monthly rise was due to widespread increases across a broad range of products, most notably a 3.2 per cent increase in the price of prepared feeds for farm animals and a 2.2 per cent increase in the price of processed and preserved meat.

Chemical & pharmaceutical product prices rose 0.8 per cent between August and September but fell 1.6 per cent in the year to September. The last time the monthly increase was higher was in February 2012, when the index rose 1.3 per cent. The monthly rise was mainly due to a 3.9 per cent increase in the price of other organic basic chemicals and a 4.2 per cent increase in the price of plastics in primary forms.

Output price index excluding food, beverages, tobacco & petroleum

The output price index for manufactured products excluding food, beverages, tobacco & petroleum rose 1.2 per cent in the year to September, unchanged from the previous two months. The last time the annual rate was lower was in December 2005, when the index rose 1.1 per cent. This index is not affected by changes in excise duty.

Input prices: summary of statistics

The overall input index fell 1.2 per cent in the year to September 2012, compared with a rise of 1.1 per cent in the year to August 2012. The input index for all manufacturing fell 0.2 per cent between August and September, compared with a rise of 1.9 per cent between July and August. The main downward contributions to the fall in the price index were other imported parts & equipment, home produced food and other imported products. These falls were partially offset by a rise in the price index for fuels (incl CCL).

The index for other imported parts & equipment fell 0.7 per cent between August and September and fell 3.0 per cent in the year to September. This the lowest annual rate since April 2007, when the index fell 4.3 per cent. The monthly fall was due to widespread decreases across a broad range of products, most notably a 1.7 per cent decrease in the price of imported electronic components & boards and a 3.1 per cent decrease in the price of imported computers and peripheral equipment.

Home produced food prices fell 0.8 per cent between August and September but rose by 10.1 per cent in the year to September. The monthly fall was due to widespread decreases across a broad range of products, most notably a 3.8 per cent decrease in the price of home produced cereals, a 2.6 per cent decrease in the price of home produced vegetables and a 5.1 per cent decrease in the price of home produced fish.

Other imported products prices fell 0.7 per cent between August and September and fell 2.2 per cent in the year to September. This is the lowest annual rate since December 2009, when the index fell 2.9 per cent. The monthly fall was mainly due to a 2.0 per cent decrease in the price of imported metal ores & other non mining & quarrying products, a 3.5 per cent decrease in the price of non EU imports of pulp and a 1.6 per cent decrease in the price of EU imports of pulp.

Fuel (incl CCL) prices rose 1.3 per cent between August and September and rose 7.4 per cent in the year to September. This is the highest annual rate since April 2012, when the index rose to 8.4 per cent. The monthly rise of 1.3 per cent between August and September is the highest monthly increase since February 2012, when the index rose 2.9 per cent, and is mainly due to a 4.8 per cent increase in the price of gas.

The index for materials and fuels purchased by manufacturing industries other than food, beverages, tobacco & petroleum industries showed no movement in seasonally adjusted terms between August and September. The unadjusted index fell 1.3 per cent in the year to September, compared with a fall of 0.6 per cent in the year to August.

Output prices: records for September 2012

All manufactured products

Annual rate 2.5 per cent, up from 2.3 per cent last month. Last higher in May 2012 (2.8 per cent). Monthly rate 0.5 per cent, unchanged from last month. Last higher in April 2012 (0.7 per cent).

Excluding food, beverages,tobacco & petroleum

Annual rate 1.2 per cent, unchanged from the previous two months. Last lower in December 2005 (1.1 per cent). Monthly rate 0.3 per cent, up from 0.1 per cent last month. Last higher in April 2012 (0.6 per cent).

All manufactured products excluding duty

Annual rate 2.2 per cent, up from 1.9 per cent last month. Last higher in May 2012 (2.5 per cent). Monthly rate 0.5 per cent, down from 0.6 per cent last month. Last lower in July 2012 (0.1 per cent).

Food products

Annual rate 2.3 per cent, up from 2.2 per cent last month. Last higher in June 2012 (2.8 per cent). Monthly rate 0.5 per cent, up from 0.1 per cent last month. Also 0.5 per cent in May 2012. Last higher in July 2011 (0.6 per cent).

Tobacco & alcohol (inc duty)

Annual rate 8.7 per cent, up from 8.6 per cent last month. Last higher in December 2008 (8.9 per cent). Monthly rate 0.1 per cent, down from 0.3 per cent last month. Last lower in June 2012 (-0.1 per cent).

Clothing, textiles & leather

Annual rate 2.2 per cent, down from 2.3 per cent last month. Last lower in July 2012 (2.0 per cent). Monthly rate 0.2 per cent, up from 0.1 per cent last month. Last higher in July 2012 (0.8 per cent).

Paper & printing

Annual rate -1.0 per cent, down from -0.7 per cent last month. Last lower in December 2005 (-1.2 per cent). Monthly rate -0.1 per cent, unchanged from last month. Last higher in June 2012 (0.0 per cent).

Petroleum products

Annual rate 3.4 per cent, up from 2.1 per cent last month. Also 3.4 per cent in April 2012. Last higher in March 2012 (4.7 per cent). Monthly rate 2.0 per cent, down from 3.8 per cent last month. Last lower in July 2012 (0.5 per cent).

Chemical & pharmaceutical products

Annual rate -1.6 per cent, up from -2.2 per cent last month. Last higher in June 2012 (0.0 per cent). Monthly rate 0.8 per cent, unchanged from last month. Last higher in February 2012 (1.3 per cent).

Metal, machinery & equipment nec

Annual rate 0.4 per cent, down from 0.6 per cent last month. Last lower in February 2010 (0.3 per cent). Monthly rate 0.0 per cent, up from -0.2 per cent last month. Last higher in May 2012 (0.1 per cent).

Computer, electrical & optical equipment

Annual rate 2.9 per cent, down from 3.3 per cent last month. Last lower in March 2012 (0.4 per cent). Monthly rate -0.1 per cent, down from 0.0 per cent last month. Also -0.1 per cent in November 2011. Last lower in October 2011 (-0.2 per cent).

Transport equipment

Annual rate 0.6 per cent, unchanged from last month. Last higher in May 2012 (0.9 per cent). Monthly rate 0.3 per cent, up from 0.1 per cent for the last three months. Last higher in April 2012 (0.8 per cent).

Other manufactured products

Annual rate 2.8 per cent, unchanged from last month. Last lower in June 2010 (2.5 per cent). Monthly rate 0.1 per cent, unchanged from last month. Last higher in June 2012 (0.2 per cent).

Input prices: records for September 2012

Materials & fuels purchased

Annual rate -1.2 per cent, down from 1.1 per cent last month. Last lower in July 2012 (-2.6 per cent). Monthly rate -0.2 per cent, down from 1.9 per cent last month. Last lower in June 2012 (-2.1 per cent).

Excluding food, beverages, tobacco & petroleum industries

Annual rate -1.3 per cent, down from -0.6 per cent last month. Last lower in July 2012 (-1.5 per cent). Monthly rate (seasonally adjusted) 0.0 per cent, down from 0.9 per cent last month. Last lower in July 2012 (-0.3 per cent).

Imported materials as a whole (including crude oil)

Annual rate -3.5 per cent, down from -1.4 per cent last month. Last lower in July 2012 (-4.9 per cent). Monthly rate 0.0 per cent, down from 2.0 per cent last month. Last lower in June 2012 (-3.4 per cent).

Fuel including climate change levy

Annual rate 7.4 per cent, up from 4.7 per cent last month. Last higher in April 2012 (8.4 per cent). Monthly rate 1.3 per cent, up from -0.5 per cent last month. Last higher in February 2012 (2.9 per cent).

Crude oil

Annual rate -2.3 per cent, down from 4.2 per cent last month. Last lower in July 2012 (-10.3 per cent). Monthly rate -0.2 per cent, down from 9.5 per cent last month. Last lower in June 2012 (-11.7 per cent).

Home food materials

Annual rate 10.1 per cent, down from 12.5 per cent last month. Last lower in May 2012 (-2.3 per cent). Monthly rate -0.8 per cent, up from -1.7 per cent last month. Last higher in June 2012 (11.8 per cent).

Imported food materials

Annual rate 3.4 per cent, up from 3.3 per cent for the last two months. Last higher in June 2012 (3.9 per cent). Monthly rate 0.7 per cent, up from -0.2 per cent last month. Last higher in May 2012 (1.1 per cent).

Other home-produced materials

Annual rate -4.2 per cent, up from -4.7 per cent last month. Last higher in July 2012 (-0.5 per cent). Monthly rate 0.1 per cent, up from -3.8 per cent last month. Last higher in in June 2012 (0.9 per cent).

Imported metals

Annual rate -12.8 per cent, up from -13.6 per cent last month. Last higher in June 2012 (-10.5 per cent). Monthly rate 0.7 per cent, up from -1.8 per cent last month. Last higher in February 2012 (2.0 per cent).

Imported chemicals

Annual rate -3.6 per cent, down from -2.5 per cent last month. Last lower in June 2004 (-3.9 per cent). Monthly rate -0.3 per cent, down from 0.1 per cent last month. Last lower in July 2012 (-2.4 per cent).

Imported parts & equipment

Annual rate -3.0 per cent, down from -1.2 per cent last month. Last lower in April 2007 (-4.3 per cent). Monthly rate -0.7 per cent, down from -0.1 per cent last month. Last lower in April 2012 (-0.8 per cent).

Other imported materials

Annual rate -2.2 per cent, down from -0.8 per cent last month. Last lower in December 2009 (-2.9 per cent). Monthly rate -0.7 per cent, down from -0.4 per cent last month. Last lower in July 2012 (-0.9 per cent).

Revisions

Revisions (Tables 8R and 9R)

For this bulletin reference tables 8R and 9R (229.5 Kb Excel sheet)
highlight revisions to movements in price indices previously published in last month’s statistical bulletin. These are mainly caused by changes to the most recent estimates, as more price quotes are received, and revisions to seasonal adjustment factors, which are re-estimated every month. The headline figures for input for May, July and August have downward revisions and the output has an upward revision for August. These revisions were mainly caused by quality adjustments due to late data.

Revisions between first publication and estimates twelve months later

Percentages

Revisions between first publication and estimates twelve months later

Value in last period

Average over the last 5 years

Average over the last 5 years without regard to sign (average absolute revision)

Total output: 12 months

2.5

-0.10

0.18

Total output: 1 month

0.5

0.03

0.11

Total input: 12 months

-1.2

0.42*

0.70*

Total input: 1 month

-0.2

0.16*

0.44*

Table source: Office for National Statistics

Table notes:

* Statistically significant.

Download table

Revisions to data provide one indication of the reliability of key indicators. The above table shows summary information on the size and direction of the revisions which have been made to the data covering a five year period. A statistical test has been applied to the average revision to find out if it is statistically significantly different from zero. An asterisk (*) shows that the test is significant.

The table presents a summary of the differences between the first estimates published between September 2006 and August 2011 and the estimates published 12 months later. These numbers include the effect of the reclassification onto SIC 2007.

Spreadsheets giving revisions triangles of estimates for all months from January 1998 through to August 2012 and the calculations behind the averages in the table are available in the reference table area of the ONS website;

Producer Prices has implemented the change to the Standard Industrial Classification 2007 (SIC 2007). The most significant change to PPI output prices involves the reclassification of ‘recovered secondary raw materials’ and ‘publishing’. These are no longer classified in the manufacturing sector, but are classified under services. In addition to this, a new SIC division, ‘repair, installation and maintenance of machinery and equipment’ has been created. Under SIC 2003 these activities were classified within the output of manufacturing, but as part of the specific industries where this activity took place.

Fundamental changes have been made to the classification of the PPI Trade surveys, Import Price indices (IPI) and Export Price Indices (EPI). As part of the reclassification project the classification of these trade surveys have become compliant with Eurostat’s Short Term Statistics Regulation. The collection of IPI and EPI will now be on an SIC basis, a switch from the Standard International Trade Classification (SITC) and Combined Nomenclature (CN) previously used. PPI input prices are heavily dependent on IPI.

Any comments about this work and its impact on PPI please contact Producer Price Index Operations on +44 (0)1633 45 6628 or email PPI Operations.

Relevance to users

Index numbers shown in the main text of this bulletin are on a net sector basis. The index for any sector relates only to transactions between that sector and other sectors, sales and purchases within sectors are excluded. However, the more detailed figures shown in reference tables 4 and 6 (229.5 Kb Excel sheet)
are on a gross basis; that is, intra industry sales and purchases are included in each of these indices.

Indices relate to average prices for a month. The full effect of a price change occurring part way through any month will only be reflected in the following month’s index.

All index numbers exclude VAT. Excise duty (on cigarettes, manufactured tobacco, alcoholic liquor and petroleum products) are included, except where labelled otherwise. Since PPIs exclude VAT, they are not affected by the increase in the standard rate of VAT to 20 per cent from 4 January 2011.

The detailed input indices of prices of materials and fuels purchased by industry (reference table 6 (229.5 Kb Excel sheet)
) do not include the climate change levy (CCL). This is because each industry can, in practice, pay its own rate for the various forms of energy, depending on the various negotiated discounts and exemptions that apply.

Common pitfalls in interpreting series

Expectations of accuracy and reliability in sample surveys are often too high. Revisions and sampling variability are inevitable consequences of the trade off between timeliness, accuracy and the burden on respondents. Details of sampling variability are included elsewhere in this bulletin.

Very few statistical revisions arise as a result of ‘errors’ in the popular sense of the word. All estimates, by definition, are subject to statistical ‘error’ but, in this context, the word refers to the uncertainty in any process or calculation that uses sampling, estimation or modelling. Most revisions reflect either the adoption of new statistical techniques or the incorporation of new information which allows the statistical error of previous estimates to be reduced. Only rarely are there avoidable ‘errors’ such as human or system failures, and such mistakes are made quite clear when they are discovered and corrected.

Accuracy

Figures for the latest two months are provisional and the latest five months are subject to revisions in light of (a) late and revised respondent data and (b), for the seasonally adjusted series, revisions to seasonal adjustment factors which are re-estimated every month. A routine seasonal adjustment review is normally conducted in the autumn annually. There are no planned methodological changes in the next 12 months.

Publication policy

The complete run of data in the tables of this bulletin are also available to view and download in other electronic formats free of charge using the Office for National Statistics Datasets and Reference Table service (if you want the data associated with this bulletin click into Download data in this release option). Users can download the complete release in a choice of zipped formats or view and download their own selections of individual series.

National Statistics are produced to high professional standards set out in the Code of Practice for Official Statistics. They undergo regular quality assurance reviews to ensure that they meet customer needs. They are produced free from any political interference.

The United Kingdom Statistics Authority has designated these statistics as National Statistics, in accordance with the Statistics and Registration Service Act 2007 and signifying compliance with the Code of Practice for Official Statistics.

Designation can be broadly interpreted to mean that the statistics:

meet identified user needs;

are well explained and readily accessible;

are produced according to sound methods; and

are managed impartially and objectively in the public interest.

Once statistics have been designated as National Statistics it is a statutory requirement that the Code of Practice shall continue to be observed.